State-owned Indian Bank hopes to convert a sizeable portion of its non-performing assets (NPA) into performing assets during the current fiscal, a top bank official said Friday.
"Most of our NPA are 'soft' ones, that is, it would become good soon. Looking ahead gross NPA will be maintained at two percent (of gross advances)," T.M. Bhasin, chairman and managing director of Indian Bank, said here announcing the results for 2011-12.
Indian Bank closed last year's books with a gross NPA and net NPA of Rs.1,850.78 crore and Rs.1,196.83 crore, respectively, up from Rs.740.31 crore and Rs.397.04 crore posted during 2010-11.
Indian Bank closed last year with a total income and net profit of Rs.13,411 crore and Rs.1,747 crore as against Rs.10,542 crore and Rs.1,714 crore, respectively, during 2010-11.
The bank's total business last year was Rs.211,988 crore (deposits Rs.120,804 crore, advances Rs.91,184 crore), up from Rs.181,530 crore (deposits Rs. 105,804 crore, advances Rs.75,726 crore).
Bhasin said the profit for the year would have been higher but for reversal of a loan account to NPA status from it earlier restructured one, increased provisioning toward education loan.
He said the bank is expecting to grow its total business (deposits plus advances) by 20 percent this fiscal even though its NIM is expected to go down to 3.1 percent from the current 3.4 percent owing to increase in its cost of funds.
The bank board that approved the accounts Friday has recommended a dividend of 75 percent.